Luxembourg income tax

Luxembourg tax calculator

Enter your income to estimate what you would pay in Luxembourg, as an employee or running your own company, and see the best-value cities. Get the full breakdown plus a vetted advisor by email.

How much is income tax in Luxembourg?

Luxembourg taxes personal income at rates up to 45.78%. Residents are taxed on worldwide income; the inbound expat regime exempts 50% of gross salary.

Compiled by MyNomadWorld for Luxembourg and currently being re-verified against primary sources. Confirm with a local adviser before relying on it.

Luxembourg expat & digital-nomad tax regime

Under the Impatriate regime regime, a qualifying new resident or foreign-income remote worker pays an effective rate of about 25% instead of the 45.78% headline. This benefit is temporary or conditional (it runs for a limited period or requires you to stay non-resident), so treat it as a head start, not a permanent zero.

Official source: PwC Luxembourg

Capital gains, wealth & property tax

• Capital gains: Speculative gains (holding <6 months) taxed at progressive rates; gains on movable property held >6 months exempt unless from a substantial (>10%) participation, then taxed at half the global rate; real-estate gains held >2 years taxed at max half-global rate.
• Wealth tax: No net wealth tax on individuals (net wealth tax applies only to companies).

Inheritance & gift tax in Luxembourg

Inheritance/succession duty; rate depends strongly on relationship and whether assets pass by the statutory (intestate) share. Transfers in the direct line (to children) up to the statutory share are exempt (0%); surviving spouse with common children exempt. Excess portions and non-direct heirs taxed on a sliding scale.

Corporate tax & VAT

The standard corporate profits tax is 16%.

How to become a tax resident of Luxembourg

Domicile or habitual abode (customary residence) in Luxembourg, generally presence over 6 months (worldwide taxation).

Cost of living & lifestyle

Cost of living is about 94% of the US level, with average purchasing power near $107k (PPP). Pick a city below to see its monthly climate and cost.

Banking in Luxembourg

You will want a local or multi-currency account for rent, bills and getting paid. See our guide to the best banks in Luxembourg.

For receiving income and moving money the day you arrive, Wise lets you hold and convert 40+ currencies and get paid like a local. Open a free Wise account →

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Climate & cost by city

Average monthly temperature (°C) and rainfall. Climate: Open-Meteo ERA5; cost of living: World Bank PPP (same-year pairing), omitted where unavailable.

Luxembourg tax treaties

Luxembourg maintains around 86 double taxation treaties in force. They generally follow the OECD Model Convention and reduce withholding tax on cross-border dividends, interest and royalties, so the same income is not taxed twice when you move, invest or earn across borders. That is a broad network, useful for internationally mobile earners and investors.

Major treaty partners

Chips with a link open the full withholding-tax detail for that treaty pair.

Approximate size of the DTA network; confirm the specific treaty and its terms before relying on it.

Luxembourg tax treaty guides

Detailed double-tax-treaty guides (withholding rates on dividends, interest and royalties) are available for 25 of Luxembourg's partners:

Armenia · Azerbaijan · Botswana · Brazil · China · Georgia · India · Indonesia · Laos · Mauritius · Mexico · Moldova · Morocco · North Macedonia · Senegal · Seychelles · South Africa · Sri Lanka · Tajikistan · Thailand · Trinidad and Tobago · Tunisia · Ukraine · Uzbekistan · Vietnam